This morning received the alert reminder from my agent due to Dow Jones huge drop.. this morning open market all gone red.. Huayang is one of the big drop in my listing.
Wisdomtot, based on the trend, breaking 1.76 is not a problem, just the matter of time, by today or tomorrow.
Dunno when this down trend going to end for most of the stocks..
dragonfruits.. do you know something which may contribute to the continuous downtrend? 7% is a big correction for Huayang, which I don't see much underlying fundamental issues.. Can you share your thoughts?
Hua Yang has an investor briefing session today. Let's see what RHB and Kenanga IB reports tomorrow.
Unless something terrible was announced in today's briefing, the sharp stock price drop today could be a good buying opportunity.
The only little concern I have with HuaYang is its debt level simply because a rising interest rates environment or drop in sales will have a more negative impact to a leveraged company like HuaYang and those with little debt. Nevertheless, at RM1.77 a share, the stock now has one of the lowest PE ratio in the property industry at 7.7X only.
I am not too worried about sales being impacted by the recent cooling measures by the federal government as the company focuses on the niche market of affordable housing. I really hope the management will gradually reduce its debt with the cash flow generated from its operation. Now and going forward in 2014/2015 might not be the best period of time to hold debt.
If you're holding this stock for the long term, you should not be too worried about today's dip.
Pay attention to what the management present in today's investor briefing. I am expecting reports from RHB and Kenanga after they have attended the briefing earlier today.
Yes, the sentiment for the property sector is weak at the moment. This applies to any property related stocks (even SCIENTEX with 50% involvement in property sector is not spared).
The pessimism with the property sector could be due to: 1. Fear that the cooling measures announced in the Budget 2014 - RPGT, DBIS & GST will slow down the demand for property. 2. New Bank Negara rules on housing debt to curb the rising household debt in the country (Malaysia has the highest household debt to GDP in the region). 3. The expectation of increase in interest rates in 2014 due to weakening ringgit and increased inflation in the country.
Keep in mind that the Property sector is very sensitive to interest rates movement (compared to other sectors) as increase in interest rates will affect property sales severely due to higher cost of borrowing.
Generally, things are on track. Like i said earlier, concern is mainly on its debt ratio and management has addressed that in the investor briefing session yesterday by stating that they will not buy more land banks in the near future and plans to reduce debt after converting some of its unbilled sales to earnings.
Management also stated that they have plan to payout good dividend, which will yield at around 6% p.a. Well, i'll just park some of my funds into this company for now since the return is better than 1 year FD.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
dragonfruits
1,285 posts
Posted by dragonfruits > 2014-01-23 15:44 | Report Abuse
now cannot?